Solan: Industrial investment down to trickle due to lack of incentives

With the state lacking fiscal incentives to attract industrial investment, only two units have been set up in the past three years in 20 industrial areas carved out across the state.

The two units have employed 431 people comprising 372 Himachalis and 59 non-Himachalis.

One unit has been set up under the Centrally-sponsored Product-Linked Incentive (PLI) scheme. It has been granted 100 per cent exemption on electricity duty for five years, 15 per cent rebate on energy charges for five years, 100 per cent exemption on stamp duty and registration fee, besides subsidised land at the rate of Re 1 per sq m.

With no such incentive being available to the state industry now, the new investment has shrunk considerably notwithstanding the expansion plans on the existing industries. While the stamp duty had been doubled, the electricity duty and power tariff were among the highest in the region, keeping the investors at bay.

A total of 189 plots were carved out in 20 industrial areas in the state in the past three years. The work on creating the basic infrastructure was under way in 149 plots, while land development and construction of buildings were under way in 38 plots. Of these, industrial units have been set up on only two industrial plots.

Kinvin Private Limited, an industrial unit manufacturing Active Pharmaceutical Ingredient (API), which is raw material for pharmaceutical units, has been set up at a newly created industrial area of Plassra in Nalagarh.

As many as 309 people have been employed here, including 252 Himachalis and 57 non-Himachalis. It is India’s first API fermentation unit. Being a key API used in the production of several antibiotics, it will meet around 60 per cent demand of the domestic market. India is heavily dependent on countries like China and Korea for this API requirement.

The unit will produce 400 tonnes of potassium clavulanate API annually. Its domestic demand is pegged at 700 tonnes per annum. The unit is being set up under the Centrally funded Production Linked Incentive (PLI) scheme. The scheme was launched for the promotion of domestic manufacturing of critical key starting materials (KSMs)/drug intermediates and APIs in the country few years ago.

Another unit has been set up at Chanour in Kangra district where 122 people have been employed, comprising 120 Himachalis and two non-Himachalis. Facing a severe cash crunch, the endeavour of the state Industries Department to provide ready-to-use industrial plots equipped with basic facilities like road, power, sanitation, etc stood defeated even as it was trying to create a land bank in the state.